BGI Americas Offers Sequencing the Chinese Way

The new office promotes the BGI brand and services.By Kevin Davies

September 28, 2010 | 25 years ago, Shenzhen was a tiny fishing village in southwest China, just one hour north of Hong Kong. Today, it is the country’s second largest port after Shanghai, a booming technology haven and since 2007, home to BGI, the Beijing Genomics Institute.

With 3,000 employees currently rising to an expected 5,000 by the end of this year, and a fleet of more than 150 Illumina and Life Technologies next-generation sequencing instruments, most of which are being installed in a former printing factory in Hong Kong (see, p. 44), BGI is poised (if it isn’t already) to become the world’s largest genome sequencing center. And it wants to share its extraordinary resources and expertise with, well, everybody.

Last April, BGI Americas was officially incorporated in Delaware as the official interface for BGI in North America. BGI Europe followed suit the next month (See, “European Union”). From a small office in an incubator space overlooking Boston’s Charles River, the husband-and-wife team of Paul Tu (president) and Julia Dan (CEO) are reaching out to potential academic and commercial partners and customers. By the end of 2010, BGI Americas will have as many as 20 sales representatives in search of partners who wish to avail themselves of BGI’s prodigious sequencing capacity.

“We’re an interface representing BGI to collaborators in America and to promote the BGI brand,” says Tu. “That means finding collaborators working on different interesting projects, or fee-for-service projects, to support our operations.” He smiles: “3,000 people need to eat!”

Tu and Dan already have cause to celebrate: a landmark 5-year deal with Merck to create value from NGS, announced at a press conference in Shenzhen in mid-September, that is certain to grab the attention of Big Pharma.

Tu graduated from MIT’s Sloan School of Management and worked in venture capital for ten years before meeting BGI co-founder Wang Jian and “drinking the Kool-Aid” (see, “Drinking the Kool-Aid”). Indeed, Tu and Dan abandoned their own start-up plans in China to sign on with BGI Americas. Tu’s wife is also his boss; Dan previously worked in corporate development for Genzyme. She lets Tu do most of the talking, but corrects him occasionally, just like any happily-married couple.

Model Offering

The growth and data output at BGI is nothing short of astonishing. The institute currently employs 3,000 staff in Shenzhen, with 1,500 working in bioinformatics, including programmers and IT staff. When Illumina introduced its new state-of-the-art sequencer in January 2010, BGI immediately ordered a total of 128 machines—Tu explains that 128 is a lucky number in Chinese. (The number eight sounds like ‘wealth.’)

“God forbid it was 124,” he adds dryly. “Four would sound like ‘death!’ ”

The new facility in Hong Kong will greatly facilitate the shipment of samples from the rest of the world. “It’s a British system: one China, two systems,” says Dan about Hong Kong. “It’s the same thing with BGI.” For investigators leery of sending samples to Hong Kong, Dan will give them the option of shipping to a sample receiving lab attached to BGI Americas headquarters, which will then handle the paperwork and shipment.

By the time the Hong Kong facility is fully operational at the end of 2010, BGI will have a total sequencing output of 5 terabytes/day—the equivalent of 1500x human genome/day (see, “Lucky Numbers”). The data center now boasts 50,000 CPUs, 200 terabytes of RAM and will reach a whopping 1,000 petabytes—1 exabyte—of data storage within the next 2-3 years. “It’s an awesome machine to play games on,” jokes Tu.

Such infrastructure comes at a price—BGI spends an estimated $10 million on electricity annually. “We cannot be a non-profit organization without any external support,” says Tu.

That is where BGI Americas and BGI Europe come in. “We’d love to work with [principal investigators] around the world, not just the U.S., on any interesting projects,” says Tu.

Back in China, a committee of animal, plant, and disease experts will select which projects BGI takes on. “BGI can be flexible—give us the samples, we can fund everything, and then we co-author the publication,” says Tu. A variant of that model would have BGI split everything—the costs, authorship and IP—with its partners.

“Not everyone can offer that. We don’t just do human, we do animals, plants, bacteria, complex diseases,” says Tu. “That’s the non-profit aspect. We want to sequence 1,000 plants and animals and have set aside $100 million for this initiative… It’s all about the science.”

But BGI is also offering a fee-for-service option. “We are a contractor,” says Tu. “Every single profit generated by the fee-for-service division will be returned to BGI to support the non-profit research agenda.” As a contractor, BGI will take any specs and deliver what the client wants. “If you want your data via FTP, or hard disk, we’ll do that. We give you a report, annotation, mapping, analysis. Not just sequencing, we also do all the back end as well,” says Tu.

Cost and Competition

Tu turns very diplomatic when asked about potential competition to BGI’s sequence service plans. “Personally, and throughout the organization, we don’t view anybody as our competitor. This field is extremely nascent. In science, what we know today may be only 2-5% of what it will be later. The science keeps advancing, we keep discovering new things.” As an example, he cites the recent UC Berkeley/BGI publication in Science that described a highly selected gene variant associated with altitude adaptation.

Dan says that, unlike a commercial service provider like Complete Genomics, BGI’s value proposition is the flexibility to offer a pure fee-for-service as well as a collaborative model. “We don’t want to be restricted by funding for which research we can do. That’s the reason we do fee-for-service, and we love to do collaborations. We spend a lot on the collaboration side.”

Diplomacy turns to downright evasion when the subject is cost. “It depends,” says Dan not unpredictably, “on coverage, analysis, volume, and so on.”

“All these players—Complete Genomics, Broad Institute, etc.—are just collaborators for us,” says Tu. “When it comes to fee-for-service, we’re at the mercy of what Illumina charges us for reagent costs. We have gigantic overheads… We’ll eat some of the overhead, but the variables, somebody has to cover... Can we compete head-to-head with Illumina and Complete Genomics...? They don’t even do exomes; they only do whole genome humans? They make their own machines and reagents, how can we compete with that?”

Tu marvels at the drop in sequencing prices over the past 12-24 months. “I’ve never seen such price erosion! This is like, Whoosh!... We’re a service provider, how can we compete with that? We compete with the back end, our bioinformatics. That’s where we’re good. Who else has 1,500 staff?” BGI makes its popular software SOAP (Short Oligonucleotide Alignment Program) freely available (http://SOAP.genomics.org.cn). Any data or tools built for the SOAP platform (using C++) are being donated to the public sector.

The average age of the BGI staff is just 24.7. Tu calls the legions of bioinformatics workers “the young and the brightest,” drawn from the top tiers of mathematicians and scientists, supplemented with operations people who have worked abroad. “If they come to BGI, they get to work on real projects. Plus you get to program all day, with these toys in the background! It’s like a video game; they love it!” New recruits cannot rest on their laurels however: every month for the first six months, there’s a test. Fail it, and it’s bye-bye BGI.

Tu and Dan have only been on the job a few months, but they too are working pretty much around the clock. Inquiries are already flooding in—mosquito genomes from Brazil, palm oil from Costa Rica, ancient DNA from the University of Massachusetts Medical Center. Tu was preparing to visit researchers at the Children’s Hospital of Philadelphia, and is already discussing projects with partners and clients at the Dana Farber Cancer Institute, Harvard Medical School, and the Broad Institute. Two experienced American sales reps have been hired, and there is talk of opening new offices in San Francisco, Canada, and Brazil.

“We want to be a trusted scientific partner and research collaborator,” stresses Tu, speaking for 3,000 and counting.

Drinking the Kool-Aid

In 2007, the Beijing Genomics Institute relocated to Shenzhen, one of China’s Special Economic Zones (SEZ) designed to attract foreign investment. The SEZ policy was announced by former Chinese premier Deng Xiaoping, who chose Shenzhen as the first territory in 1978. Back then, it was “just a fishing village and rice paddies,” says BGI Americas president Paul Tu. “Now it’s more modernized than Boston. It grows the size of an old Paris annually.” Shenzhen boasts three Sheraton hotels, he points out.

The shift in power in genome sequencing to China follows a trend seen in other industries, says Tu. The semiconductor industry began in the United States in the 1950s, before shifting to Japan, then Taiwan, and now mainland China. A similar phenomenon took place in textiles, although now Vietnam and Cambodia are wrestling business away from China.

Tu praises the visionary role of BGI co-founders Wang Jian and Yang Huanming. “They are both scientists, were never merchants,” says Tu. Wang returned to China in 1998, encouraging the Chinese government to invest in the Human Genome Project. As a privately held organization, Wang saw the benefits of relocating the institute’s headquarters in Shenzhen in 2007. “He donated all of BGI research to the local [Shenzhen] government,” says Tu. In exchange, the local government will sponsor certain projects, while giving BGI complete freedom in selecting its choice of projects.

Tu recalls meeting Wang Jian for the first time and listening to his desire to help move science and advance personalized medicine, to leverage genome sequencing data. “When we first met him, we just drank the Kool-Aid!” he says. “For personalized medicine to materialize, sequencing is the most fundamental basic step.” K.D.

European Union

BGI Europe was registered in Copenhagen, Denmark, in May 2010, and officially launched in June at the European Society of Human Genetics. The plan is to invest $10 million and to recruit 20 local staff in the organization’s first year alone. The CEO of BGI Europe is Mason Mak, who joined BGI earlier this year, although he is based primarily in Shenzhen.

Given BGI’s historic ties with Denmark, it is no surprise that BGI Europe headquarters is in Copenhagen. The president of BGI, Yang Huanming, obtained his Ph.D. from the University of Copenhagen in 1988. BGI’s director, Wang Jun, is a visiting professor at the University of Copenhagen and Aarhus University.

A new Copenhagen research institute on metabolic diseases, funded by a $170-million donation from Novo Nordisk, will strengthen an ongoing collaboration with BGI, led by diabetes researcher Oluf Pedersen. He says the alliance with BGI will create “an international powerhouse in the field of medical genetics.” (Diabetes and obesity are a growing health concern in China.) “Genomics cannot be done alone,” says BGI director Wang Jun. Danish collaboration harnesses the superb medical infrastructure in Denmark with “Chinese genomics muscle” in the study of type 2 diabetes and obesity.

According to BGI Europe’s business development director, Danish-educated Wang Xuegang (he prefers to go by the name ‘Greg’), BGI Europe will offer European clients two models—collaboration or fee-for-service—just like its American counterparts. BGI Europe has six sales people already, but will be recruiting additional staff specializing in different fields such as agriculture, pharmaceutical, and biotech, spread across key regions including the U.K., Germany, and Scandinavia.

As for what BGI’s key selling point is, Wang Xuegang says it is not necessarily the cost of sequencing. “Price is not what we sell on,” he says. A bigger selling point is BGI’s “very strong bioinformatics team,” with its immense experience in genome data analysis and de novo sequencing.

BGI Europe has an even more ambitious agenda than its American counterparts. The current plan is to establish a sequencing facility, probably in Copenhagen, within a couple of years, while growing the local staff to around 100 people. It would be futile for BGI Americas to set up a sequencing operation in the Broad Institute’s backyard, but BGI Europe may see an advantage to establishing a local production base in Copenhagen.

“Our vision is to make BGI Europe one of largest centers of sequencing services and bioinformatics,” says BGI Europe’s Xuan Min. “We’re trying to set up a sequencing lab in Copenhagen,” adds Wang Xuegang, likely in collaboration with a biotech partner or partners. The availability of a local facility might appease some potential biotech clients worried about data security and privacy. “We can set up a pipeline where everything is under control by the customer,” says Wang. K.D.

This article also appeared in the September-October 2010 issue of Bio-IT World Magazine. Subscriptions are free for qualifying individuals. Apply today.